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tom ricketts cubsOh good, more financial discussions …

  • Cubs Owner and Chairman Tom Ricketts spoke with Gordon Wittenmyer yesterday, and largely confirmed everything we currently believe about the state of the Cubs’ finances. Give it a read. In short, Ricketts confirms that servicing the debt used to purchase the team does come out of the revenue the Cubs generate (and thus reduces the amount of money available for use by baseball operations), though he cautions that it’s less than we might think. Ricketts says that the baseball budget does not inhibit anything that Theo Epstein and Jed Hoyer want to do (which, to my ear, conflicts with what Epstein said about spending more at the big league level right now in an ideal world), and the lack of payroll spending right now is merely reflective of The Plan. Once again, you get the sense that big-time spending isn’t likely until the TV deal is re-negotiated, the Wrigley Field renovation is underway, and attendance starts creeping back up (there’s that chicken/egg issue again).
  • None of that surprises me, and, as I wrote earlier in the week, I generally buy it. What’s harder to parse is the language/tone of the article, itself, which has a more dire feel than how the organization paints things. At some level, that’s to be expected, but I keep coming back to: what if it’s simply true that not spending a lot on payroll right now really does make the most sense for everyone involved, given the state of the rebuild and the state of the business operations? Does that mean the same thing as “cheap”? Just as concerns about a lack of wins weren’t going to pop up for me until 2014/2015, concerns about “cheapness” aren’t going to pop up for me until 2015. Since Epstein and Hoyer took over, the only free agent they’ve missed on that really bothers me is Yu Darvish – and that wasn’t really an open bidding system. Maybe Anibal Sanchez, too. (But not necessarily Yoenis Cespedes – looked at his numbers lately?) So, at bottom, what are we left with when it comes to a lack of spending? In these two offseasons, big-time spending wouldn’t have made sense anyway, whether they had the money or not.
  • Speaking of some of that stuff … yesterday’s announced attendance of just over 20,000 fans was the lowest since 2002. But, hey, then the 2003 Cubs were surprisingly good, and things turned around!
  • Dioner Navarro’s career year continues after another big game yesterday. He’s hitting .305/.369/.515 on the year, and I’d be surprised if he didn’t go into the offseason hoping he could land a starting job somewhere. The Cubs would undoubtedly like to have him back in a pairing with Welington Castillo next year, but Navarro may have played himself into the pricey luxury range, when it comes to back-up catchers.
  • If you were concerned about the young fan hit by the bat yesterday when Giancarlo Stanton accidentally let it fly, it sounds like he’s OK.
  • Werner

    When teams have a backup as good as, say, Navarro, why don’t they split time evenly with the other catcher? I know most backups aren’t but surely there’s been situations like this year for the Cubs where it seems like a good idea to save wear and tear on both catchers.

    • TheDondino

      In our case, it’s purely for the development of Castillo. Navarro isn’t the long term option at catcher for the Cubs, Castillo might be.

    • King Jeff

      Navarro has played in 75 games compared to a little over 100 for Castillo. That’s about as even of a split as you can get for a lefty/righty platoon.

    • hansman1982

      Because what they are doing with Navarro, presently, is working. Increasing his playing time may lead to him being put into situations where his bat doesn’t play well and therefore offer worse production than Castillo.

      • Jay

        Plus he’s such a butcher defensively there’s no way you can give him the everyday job. The only catcher in history I can think of who’s bat was so good that you had to play him no matter how lousy he was behind the dish was Piazza.

  • jon

    The attendance isn’t going to creep back up if they continue to trot out such a garbage produce on the field, is Tommy really this naive?

    • http://www.bleachernation.com Brett

      No. He’s not. You may want to read the article.

      • jon

        When I read words like “exciting” and “compelling”, I see that as, calling up the young kids(cheap) in a few years, and hopefully they will excite the crowd and that will translate to better attendance. It seems like they will wiggle out of every opportunity to spend money to improve the big league club. You know what, it’s possible to spend money on the big league club AND develop your minor league system. In Theo’s presser, I think he used the term “dual fronts”, anyone remember that?

        • baseballet

          Parallel fronts has been amended to one front.

          • Jay

            I do find it interesting that Theo has come out and said that they’re not going to lower ticket prices because the team feels that the “Wrigley Experience” justifies keeping prices where they are, despite the product on the field. Kind of slap in the face to real Cubs fans but while I’m totally onboard with how they’re going about this rebuild, I’m also glad to see some fans staying away which should show the team they’re at least partially wrong in this regard. And, if attendance is falling perhaps that will prod them into opening up the checkbook a little earlier.

    • Cubbie Blues

      Did you read the article? “In terms of attendance, the way I look at it is we have to win”

    • Cub Fan Dan

      I think thats pretty much what he said:

      “In terms of attendance, the way I look at it is we have to win,” Ricketts said. – “But obviously, it’s incumbent upon us to make sure we put a more compelling team on the field, and attendance will take care of itself.”

  • jon

    *meant product, but like produce, what they put out there spoils quickly….

  • ETS

    There aren’t many free agents I would want to spend crazy money on this year, regardless. Maybe Jacoby, but only if it doesn’t get to “crazy money” levels.

    However, I will be extremely disappointed if we aren’t in on Tanaka or Jose Abreu (or both).

    • cubchymyst

      Curtis Granderson is an interesting free agent who’s name has popped up every now and then but hasn’t quite received the same attention as Choo or Elsbury. Be a lefty with some pop in his bat and since he has been injury this year he might settle for a shorter contract. He could make a decent LF next year. Him, Rizzo and Scheirholtz would provide some LH power in next years line up. I think I’d rather have Granderson than Sweeney or Bogusevic, and let Lake take CF depending if he makes progress on his defense in that position.

    • hansman1982

      Even if Ellsbury doesn’t get into crazy levels of contract, I’m not sure I want him. A 30+ year old player that relies on speed…ehh.

      (although, sans his 2011 power surge, he sure seems like a decent comp for Almora)

      • http://www.shadowsofwrigley.com TC

        Almora’s never going to steal that many bases. If he steals 20 in a season, Cubs fans should be happy. He’s only an average runner

        • hansman1982

          Very true, most comps fail at some spot anyway.

  • Curt

    I guess my question is how much did the ricketts overpay for the cubs and is the length if the rebuild bc of the kids on the farm taking x amount of time or is it bc of the finances and even when the kids start coming up will this team turn into s lot of the teams in the 70″s and 80″s hve a couple stars that they pay and garbage around them bc they won’t pay for the pieces you need to win.

    • Scotti

      The Cubs valuation has increased since the team was purchased by the Ricketts so there’s no indication that they overpaid for the team.

      The rebuild is taking longer than expected because the Wrigley renovation is taking longer than expected. If the team started pouring cash into the product then they lose the leverage that angry fans bring to the bargaining table. The simplistic argument of “See, the Cubs don’t need X because they are winning without X” is daft but effective.

      At the end of the day the Cubs, if they win, will be a 2 billion plus enterprise. Only if they win, though. No worries about whether or not the Cubs have the incentive to win down the road.

  • cubchymyst

    If the Cubs loose Navarro, it be nice if they can find a lefty or switch hitting catcher to replace him with. The Right/Left catcher pairing seems to have worked well this year the Cubs. Though that is likely mostly because Navarro and Castillo both have had good years.

  • Rebuilding

    Good for Wittenmeyer for asking some of the questions we’ve been asking

  • Mush

    I understand the payroll thing but quit signing injured reclamation projects. Cubs had over 10% of payroll on DL to begin the season.

    • cjdubbya

      So did the Yankees.

      • Mush

        That’s because the Yankees can absorb it. The Cubs at this point can’t. Every dollar needs to go to a productive player is all I am saying.

    • Coldneck

      My problem with signing the reclamation projects is that it costs us about $11M for Feldman and Baker. I would have preferred they spent that $11M to obtain a legit player that would produce. Turns out I was wrong and this worked very well for the Cubs as we were able to trade Feldman, save half his salary, and net Arrieta for future years. Obviously we got nothing from Baker, but what we got out of Feldman made that not matter so much.

  • ETS

    ” Since Epstein and Hoyer took over, the only free agent they’ve missed on that really bothers me is Yu Darvish – and that wasn’t really an open bidding system. Maybe Anibal Sanchez, too. (But not necessarily Yoenis Cespedes – looked at his numbers lately?)”

    What about ManBearPuig? I still am not convinced Soler isn’t the best prospect in the system. Really too bad he was hurt most of the season.

    • Jarder

      ManBearPuig got a ridiculous contract that no other team was willing to come anywhere near to matching. It seems like a good deal now, but teams don’t have the ability of foresight to predict these things.

      • jon

        That’s why you spend alot of money and cast a wide net.

        • Jarder

          Something the Cubs have done well. They have spent a ton in international free agency and the draft. Can’t sign them all.

      • DocPeterWimsey

        Yeah, people have quickly forgotten that Puig’s signing generated a lot of head scratching, and a lot of that had to do with the lack of information about him. Either the Dodgers got lucky, or they had information that the other teams did not.

        • ETS

          I’m leaning towards “got lucky”. Their strategy of Sign All the Players! had to payoff eventually.

          • Scotti

            What I’ve heard is that the Dodgers didn’t even know Puig but that they heard others (including the Cubs) were on him and they simply overshoot everyone else.

            • EvenBetterNewsV2.0

              Puig had a lot of attitude concerns at the time of his signing that made Soler look like a great pickup. In hindsight it looks good, but at the time the money given the questions were head scratchers.

      • Kyle

        “but teams don’t have the ability of foresight to predict these things.”

        Isn’t that literally and exactly the job of the baseball operations department?

  • Rebuilding

    Being optimistic today – we could possibly add two high impact, All-Star quality players to the roster next year by the All-Star break in Baez and Bryant. Add in Alcantara and you have 3 quality players at the minimum. That leaves a lot of cash for other spots

    • Scotti

      I’ve been high on Alcantara since his first few weeks in the Dominican Summer League. That said, he has a ton of issues to work through right now. Wishing on both Baez and Bryant is too much for me at this point. Adding Alcantara is way too much.

  • Jarder

    While I would like to see the Cubs spend more, we are in a period where large payrolls do not necessarily equate to winning teams or guaranteed playoff berths. Teams are also resigning their own players earlier and buying out free agent years reducing the quality of free agent classes. These things coupled with the fact that the new CBA promotes losing to gain more money to spend in the draft and on international free agents means that its better to allow a team to develop organically through the farm than through free spending.

  • TWC

    “Oh good, more financial discussions …”

    Lulz.

  • Paul

    These guys are eerily resembling a government. Theo may be a one term president.

  • The Dude Abides

    Rickett$ should make any Cubs fan nervous. Would like to hear what really is being said between Rickett$ & Theo behind the scene. Hard to believe this is exactly what Theo signed up for. As long as Theo stays I believe, if he leaves all bets are off.

    • http://www.shadowsofwrigley.com TC

      I wonder if this is exactly what Theo wants. In Boston he got a reputation of just buying a lot of players (the Red Sox earned nicknames like the Second Evil Empire under his direction) and of just lucking into players (Manny, Ortiz, and many others were with team or in minors by time he took over as GM). When he came to the Cubs he mentioned a new kind of challenge, and I wonder if he’s interested in shedding some of that reputation and completely rebuilding an organization.

    • Mush

      I agree with you 100%. If Theo leaves, I will too.

      • D.G.Lang

        I believe that Theo was specifically signed to conduct the rebuild throughout the entire system, not just the MLB club. As part of the, he was allowed to bring in his own quality staff and entirely rebuild the Front Office.

        Once he has gotten all of his people functioning fully it may not matter if he leaves at the end of his current contract because the hard part of the job should be completed and most of the people he added will most likely remain whether he stays or leaves.

        The biggest obstacle remaining is for the finances to improve enough to support the acquisition of more competent players. Building up the revenue stream is the biggest task ‘remaining’ other then the Wrigley modernization.

        I agree that all the stalling by the city and the rooftop owners has greatly delayed the rebuild process and impaired the new revenue streams.

        The city has harmed the incoming revenue for MANY years already which has also contributed to the lack of available funding to purchase High Quality free agents.

        If the Wrigley rebuild can’t be accomplished in a short time, I feel the it would be the best for the Cubs to leave Chicago entirely and build a completely new complex in the very close suburbs where they can not only build as many new signs and LED ‘Scoreboards’ but also improve the way the stadium is situated to avoid all the current wind and sun/shade problems. They can also sell the tickets at a lower price due to avoiding the ridiculous surcharge Chicago places on the tickets as well as the excessive real estate taxes along with any city licensing and other fees.

  • cubfanincardinalland

    You need to start considering that free agency is just one of the ways payroll flexibility allows you to aquire quality players.
    Ricketts is in full spin mode. In complete contradiction to what Theo said a few days ago, which was he was forced to take a long term approach, not by choice, but because of financial constraints.
    And we get complete ambiguity as to when or even if they will ever do anything to the stadium. What a freaking mess. I give Epstein less than 12 months, he will be out of there.

    • Jim L.

      He’s put in a lot of competent people, if that means McLeod stays and is promoted to GM, it would not be a total loss.

  • SenorCub

    We are no-where close to being competitive in 2014. We need pitching and not much in that market this coming year from a FA standpoint. Positions players, we have plenty of those coming up through the farm. Jacoby and Abreu or Choo Choo are not going to make the difference when the Shark gives up so many HR/Slams. Hard to compete when you are giving up 7 runs a game and struggle to put up 2-3 on your side.

  • gutshot5820

    Well Ricketts are not cheap, but you can definitely describe him as frugal. On hindsight he is at the bottom of the list of owners we could have had. Thank you Bud Selig you ass..Yes, he has a decent plan, but it is the only plan available based on his priorities. So far we are in the fourth year of his ownership and tbe third highest ticket prices in baseball and total suckiness. We better hope the big four dont bust or get injured otherwise it will be another hundred years.

    So depressing to listen to Ricketts talk. He obviously is not willing to spend a dime out of his pocket until all the bills are paid and he is profitable. Which is fine and his choice, but wow that totally stinks. He needs to just shut the heck up and stop talking about reinvesting every dollar back into the ballclub and talking and acting like he is a huge fan. He’s just another billionaire owner looking to squeeze every dollar of profit from the Cubs.

    • baseballet

      Ricketts is frugal. I saw him clipping coupons at the laundromat while he waited for his white dress shirts to dry. He dropped a quarter under the dryer and got on the ground and dug around for it.

      • Cubbie Blues

        Good for him.

      • Castro to Barney to Chance

        I can respect that.

        But more seriously, gutshot is quite on point here. It is fully the owners’ prerogative to make money from their holdings. It was also Ryan Dempster’s prerogative to decline a trade to Atlanta. Both of these things make me unhappy as I am (in no way I can explain logically) very attached to “the Cubs” as an organization. Owners, managers, players, politicians, etc. can all make me happy about what is happening to this organization by doing what is within their rights; they can also all make me unhappy about the same.

  • http://Permalink papad1945

    I just hope they don’t put themselves in a big hole on F/A’s. Some of the players talked about have had injury issues over the past two seasons. Theo has spent big money over the years and we just got the Cubs out of some big contracts. I want the Cubs to 15 games over 500 next year and the fans they care about winning. Play our good upcoming prospects from the start of the year. I’m 68 yrs old and don’t know how much longer I can wait.

  • cubfanincardinalland

    I also ask again. Do you think Epstein in his wildest imagination, thought he would be limited to a $90 million payroll in 2013, and probably less in 2014? And would he have even considered the job knowing that?

    • jon

      Nope. Which is why he mentioned “dual fronts” multiple times at this press conference. For some reason, there appears to be this misconception that you have to curb spending and trot out a shitty major league product in order to build up your farm system, which really isn’t true at all.

      • willis

        No he didn’t. He also doesn’t like the fact that his name is all over two years of one of the worst records in baseball in one of the biggest markets. I can’t imagine he signed up to be the head of a “middle market” team after all of his success in Boston, watching team after team be the laughing stock of baseball.

        When Ricketts speaks I cringe.

        • SenorCub

          Let’s be clear, I doubt Epstien was duped! He is a smart person and knows what he is doing. He has done wonders with the Farm system. He said all along this was a long term vision. I don’t believe Rickets has stopped him in making any moves with FA, there really haven’t been any FA that would knock your socks off. Our time is coming, be patient. We need pitching more than anything and will be legitimate players in 2015.

      • Aisle 19

        that has been Theo’s plan from the beginning. Now it seems he’s trying the
        old CYA.

        • Jay

          He also wasn’t anticipating the new signing restrictions in the domestic draft, which he went on record as saying was an obstacle that might lengthen the process. Which is why he went crazy in the international draft. Theo’s no fool.

  • Cubbie in NC

    I do not want to see the Cubs stuck with 7 year or longer deals of which the last 3 years the players are shells of their former selves or are blocking the kids coming up.

    If any of the guys talked about want to sign a 3 year deal for more money per year I am all for it.

    I see the Cubs as being two years away from knowing what they need to win. A couple of players here or there can get them from bad to mediocre. But if the end game is mediocre I am going to be very disappointed. Other than some spare parts the Cubs don’t even know what they need to be great at this point because the players coming up are unknown quantities.

    No free agent is going to make a dramatic difference in the Cubs. They are too many players away. I think that the Cubs are going to have to do what the Nationals did with Werth. Knowingly overspend because that is the only way players would come to a perennial loser. In the Cubs case also with bad facilities.

    The path that Ricketts has set I agree with Brett that it will be 2 years before we know if Ricketts is building a team capable of winning a world series and competing every year, or if he is getting by because no matter how much we complain we will still watch and love the Cubs despite the frustration.

    • Jay

      In Werth’s case, the GM has admitted he went and got Werth a year earlier than he really wanted to, but he felt that was the player he needed and that year was when he was available.

      • http://vdcinc.biz 70’scub

        Check the standings Werth has not been even close to worth!

  • mister_rob

    I think back to the Marlins this past winter. Remember the uproar? How an owner/team could get rid of everyone and not even try and compete. Fast forward 6 months and our beloved aren’t really any better than the Marlins at the major league level

    Now some of the uproar was because they sold the fans down there on a new stadium and promises. Of course up here we had the whole “every season is sacred” boloney that has clearly proven to be bunk as we are already setting up year 3 to be another punt

  • Tim

    I don’t have a problem with the Rickets paying off their debt while the young kids develop. We haven’t missed out on anyone, as Brett points out, and our future is extremely bright. I think the biggest point is the Cubs will spend at the right time. People are so impatient.

    Look ahead one year, it is quite possible Baez, and Bryant will be here, with Alomora and Soler not too far behind. Impact talent is close, this will be the last year you watch a bad team play. Even this years team is leaps and bounds better than last year. There is a trend here folks, and the Cubs line is pointing up. We should be excited about being a Cubs fan now, it’s about to get really good. Enjoy the ride fellas

    • jon

      Baez is realistically the only one who will make an impact next year. Bryant, maybe in September..so how is this not a bad team again next year, unless they are willing to invest a bit in the major league roster?

      • Tim

        They will be a better team. Look at the strides made between last year and this year. Look at our run differential. Look at how many live arms we will have in the bullpen next year. What if they add a on base machine like Choo? This team is not awful, good pitching, solid defense, and stars coming up to aid the offense. How can you be down on what they are doing?

        • jon

          Again, only one of those ‘stars’ will make an impact next year and that is Baez, I’ll also add that of the Cubs big ‘4’ prospects it’s highly unlikely that all ‘4’ will become stars(depending on what your definition of star is, for me it’s a 5+ win player). If we are lucky one or two will become stars, and you hope the rest can contribute at a + replacement level. I love what they are doing but you have to keep expectations in check…. only a certain % of prospects will actually hit and you will need to supplement your major league roster accordingly.

          • On The Farm

            I think there are two players that will come up and make this team better next year. Obviously whether Baez comes up to play 2B or 3B (I think the latter) he will be an improvement. He will add to our power department, and allow Valbuena to shift across the diamond to either split time or take Barney’s spot. Then after a bit Alcantara (if he can hit in AA, he should be able to hit in the friendly PCL) could be up. Alcantara could provide another upgrade at 2B, and he is a switch hitter so all the people who like balance in the lineup should be happy. Another plus of Alcantara is that he can be a leadoff type of player. Those two players alone could solve some issues with our team.

            All of that is only expecting one prospect to be a star (by your definition), and another to be an upgrade/above replacement player. That’s a pretty good starting point.

            • Chad

              Everyone dismisses Baez at SS. I think he could move Castro to 2B or out of the organization. If Castro goes to 2B then Alcantra could be included in a big trade. I’m not giving up on Baez at SS yet.

              • Cubbie Blues

                That’s because SS is the only place where Castro’s bat is a plus.

              • On The Farm

                I dismiss it because the FO doesn’t like selling low which is what an offseason trade of Castro is. Baez has a bat that plays well at 2B, SS, and 3B so why not shift him to 3B, let your two time All star recover his value.

                • Eternal Pessimist

                  I agree with everything you said in your last two comments. Baez and Bryant are under control for a long time and can be re-shuffled (Baez to SS, Bryant to 3rd) if Castro is later traded.

                  Alcantara to cover 2nd is his best fit. Olt, Jackson, Vitters, and anyone else that re-discovers there game will be trade bait (I hope) for future pitching but their clocks are ticking and we need to consider moving some of them soon, I think.

                  • Jay

                    Castro’s going to get the entire next year to prove this year was a fluke (and if they stay out of his head and let him swing the bat, I think he will). Nobody’s going to be in position to take over for him til 2015 at the earliest, so at that point we either shop him or he’s returned to form.

            • jon

              Great, so both Baez and Alacantera come up sometime in June, produce at a star, and replacment+ level accordingly. You still have a bad team unless you fill some more holes on the major league roster.

              • On The Farm

                Baez could be like Harper and be up in the May time frame, with the production Valbunea provides, its still a good upgrade. In the mean time you have a few options at 3B for one month. Valbuena can play right around average 3B, Murphy will be in contention assuming they bring him back, his month of September, if done again next April would be more than respectable for a placeholder until Baez can be brought up. And then there is Olt, he is still an option and it is foolish to completely write him off, right now he is option three with the first two options providing league average for 1-2 months.

                • jon

                  All of your EXTREMELY optimistic projects could happen, but even if they do, this is still a BAD team next year. (unless they spend). It’s not really hard to understand.

                  • jon

                    And I also think Villenueva is more likely to produce at the big league level than Olt.

                    • On The Farm

                      That’s fine, I just think it is foolish to completely write off Olt, there is still a chance he comes back is all I think people need to consider. I think the 2014 team will mirror the 2013 team (although with Strop and Parker in the pen that aspect should be better) and if we add one SP through FA we should have a similar rotation and we can be .500-ish, add Baez in late May/early June, add Alcantara in late June/July time frame and this team could be a touch below 82 wins, which is a step in the right direction. Attendance will increase and that should increase revenue for the 2015 season. Add that in 2015 Bryant, Johnson, and others could be available in house for 2015 and the team will continue to get better.

              • Cubbie Blues

                Except they were a .500 team before the beginning of the year on paper. That is not a bad team. If Rizzo didn’t have the bad start and his BABIP was up where is should be and Castro didn’t have the down year, we would have had a lot better record at the trade deadline. We still would have sold off and we would still be looking at a poor product on the field, but everyone would be feeling quite a bit better about the situation.

                • Rich

                  but Rizzo did have a bad start and Castro struggled. Cannot assume those things will magically be better next season. I hope it is, but it could be the new norm.
                  I think Castro will be much better next season.
                  Rizzo, I dont know.

                  • Cubbie Blues

                    Well, then, we can’t assume anybody is going to perform the way they have for the last few years. Let’s just throw up our arms and say “who freakin’ know what is going to happen I’ll just hide my head in the sand”. Magically assume? Rizzo has shown all year that he can hit. Look at his peripherals. Castro, he is starting to hit now that he isn’t thinking as much at the plate. It’s not all cherries and rainbow, but it isn’t all doom and gloom either.

            • jt

              “I think there are two players that will come up and make this team better next year.”
              — On The Farm
              *
              not sure if this will come to be or not but the possibility that it may happened makes it silly to waste a large amount of resources on a problem that may fix itself.
              Then there is the surplus of talent in the prospects range top 10-20 who have established value. How do they effect the winter hot stove? Do trades make available options other than Jacoby or Choo?

    • Dave

      Most young players don’t make an impact right away.
      There’s no Trout or Harper here.
      Look at the Royals young hitters and how they have struggled to adjust. That is a much more realistic expectation of what we can expect.

      • On The Farm

        Or you can look at Wil Myers (who was a top 10 prospect which is where Baez has played himself into) and look how well he has done with the Rays. He is not coming out quite like Machado, Harper, or Trout (the second time around) did, but he is still playing at a very respectable level.

  • http://deepcenterfield.blogspot.com Jason Powers

    A ‘clearer’ picture of MLB and Chicago Cubs situation.

    *For debt service, depending on a interest rate between 2 to 3% for 30 years and 12 monthly payments – I assume this as a rational basis for the debt load of $580 million – the variation in debt service will be $25.68 to $29.27 million per YEAR. (If Excel PYMT function is right.)

    *From the column, 100,000 fans lost is AT LEAST equal to $7 million dollars. This jives with Baseball’s reported revenues in past seasons above $75 per fan. (For 2012, attendance was at 74.85 million. Forbes calculated revenues for MLB at $6.8 billion.
    http://www.suntimes.com/sports/22361291-419/tom-ricketts-says-quick-fix-not-in-cards-for-cubs.html

    http://www.businessinsider.com/team-revenues-show-the-true-disparity-in-major-league-baseball-sports-chart-of-the-day-2013-3

    *Cubs recent track record for attendance and est. revenues from GATE only
    Year –Attend/game—Home Record —Year Attendance —(Est. Revenues/$75/per head)
    2009: 39,610 (46-34) — 3,208,410 —-240.6M
    2010: 37,814 (35-46)—3,060,294—–229.7M
    2011: 37,258 (39-42)—3,017,898—–226.3M
    2012: 36,158 (38-43)—2,928,798—–219.7M
    2013: 33,095 (27-43)—2,680,695—-201.1M

    *This somewhat jives with Forbes 2013 allocation of revenues minus their TV revenues for the Cubs in 2012, putting them at $274 million total.

    *Roughly, as Brett pointed out, the 2013 Cubs cut $13.65M – quite nearly matching the revenues lost – $18.6M from current projected attendance and resulting revenues.

    ****In short, the debt load ratio to revenues IS approximately 10% of the Cubs total take (26-29m/274)– assuming Forbes is even close, and these projections are too – this is quite a line item.

    Given also the increases in staff, international spending, the sensitivity is there to modifying their plan. Thus, the significant reductions in PAYROLL from 130 down to 105 Million – and likely much lower.

    That’s my take.

    [img]http://static4.businessinsider.com/image/5154a429eab8ea8670000014-608-457/untitled-2-200.jpg[/img]

    • CubFan Paul

      Looks like the long way of confirming what we already knew: the Cubs average $270M in revenue a year.

      If Ricketts wasn’t making debt payments out it the Club would be fine and not “have to build the organization from the ground up”

      • http://deepcenterfield.blogspot.com Jason Powers

        Well, it’s called verifying what can be had from various resources and logic. Instead, of WAG – wild ass guesses. And accusations without any factual support.

        But thanks for your time.

        • CubFan Paul

          There was NO guessing at the “average” of $270M. It hasn’t changed.

          Thanks for wasting your time.

          • http://deepcenterfield.blogspot.com Jason Powers

            I actually enjoyed doing it –

            Not EVERYONE KNOWS what you know…so why don’t you educate more, and smart off less. Or is that just an overriding characteristic of your interpersonal skills?

            • CubFan Paul

              “so why don’t you educate more, and smart off less”

              Apparently you’re a newbie here. The Financials are only a secret to you. I apologize for making you feel dumb, but i wasn’t smarting off, i was just saying “Looks like the long way of confirming what we already knew: the Cubs average $270M in revenue a year”

              No need to get butt-hurt

    • Northside Neuman

      What’s interesting about these revenue numbers is the Cubs currently have a horrible TV deal and lag almost every team in revenue streams generated from their ball park. And by that I don’t mean attendance, but in ball park marketing “jumbo tron”, revenue from things like sky boxes and private clubs for dining, and club level seating, etc, etc. They are going to leap frog the Red Sox in revenue if they ever get this renovation done.

  • CubFan Paul

    So, I was right (re: first bullet). It only took about twenty months.

    • http://www.bleachernation.com Brett

      Not for nothing, but it’s been the subject of ongoing discussion and debate for years – and most had already come to that conclusion back in April.

      http://www.bleachernation.com/2013/04/26/yeah-ricketts-family-debt-service-payments-are-probably-coming-out-of-cubs-revenue/

      • CubFan Paul

        And this is what I said that day in April:

        “I saw this coming the first year Ricketts lowered the payroll. I posted it here and was (and still) blasphemed.”

        April of 2013 was little to late to stop drinking the KoolAid. And if not for Wittenmyer most people’s heads would still be in the stand.

        • TWC

          I can’t help but think that anyone who grandstands on the internet shouting “I told you so!” at every opportunity has a pretty sad, pathetic little life.

          Pauly, here’s a hint: no one cares what you opined (“Guessed at”) twenty months ago. No one remembers, or if they do, they certainly don’t give a shit. Don’t throw your shoulder out by patting yourself on the back any more. It’s not worth it.

          • CubFan Paul

            Mad that you were wrong? Its okay, go ahead and attack me (on the internet).

            • Northside Neuman

              Wow, you guessed that revenue was coiming out of the business that the debt was tied too???

              Who’d have thunk it?

              • caryatid62

                Many, many people here argued pretty vehemently against that thesis, insisting that this was all part of a grand baseball plan to “build from the ground up.” In fact, many still make that claim.

                • Cubbie Blues

                  Just to be clear, I was not part of that crowd. I always assumed the debt was being paid from the revenue.

      • http://deepcenterfield.blogspot.com Jason Powers

        You were spot on…

        The biggest variable is how that 50% of the TV contract goes – if they add say 50-70 million per year via that – it covers that debt service item.

        Advertising: HOW much will that bring in? 30-50 million???

        Meanwhile, the upcoming renovations will generate a debt load too. Is it 300 million or a 500 million dollar project? (I’ve seen two numbers)

        • CubFan Paul

          “Is it 300 million or a 500 million dollar project?”

          $300M is Wrigley itself..Five $60M projects over five offseasons

          The other $200M is the Hotel and other stuff i believe.

          • http://deepcenterfield.blogspot.com Jason Powers

            More debt service with requisite revenues in the pipeline.

        • Jarder

          Some of the renovations will provide new revenue streams though. The new signs and Jumbotron will help offset some of that debt load. I also believe the new CBA plays a role in the declining payroll; there is a benefit to losing as it means more money to spend on young cost controlled players.

        • hansman1982

          IT’s $300M on Wrigley and $200M on the hotel and items around Wrigley.

          • http://deepcenterfield.blogspot.com Jason Powers

            Thanks hansman.

        • Northside Neuman

          $300 million for the stadium and office building component.

          $200 million for the hotel, which according to the zoning approval documents, which can be located on the ChicagoTribune website is in a seperate business LLC entitiy from the Cubs and won’t be included on their books.

          • http://deepcenterfield.blogspot.com Jason Powers

            More nuance to the equation….

            • cubfanincardinalland

              It’s zero dollars for the Wrigley renovation. Never going to happen in my opinion. How’s that construction schedule moving along?

  • Paul

    Wrigley renovation may not happen todays Sun Times the big T at it again maybe they should move this FO is ok Ricketts is ok people should LOOK at old FO one year 2003

    • TWC

      Oooh! Do we get to punctuate your comment for you? Cool. This is how I chose to read your screed:

      “Wrigley: renovation may not happen? Today’s Sun Times (the big T) at it again? Maybe they should move — this FO is OK. Ricketts is OK? People should LOOK. At old FO: one year: 2003!”

      • gutshot5820

        Ok..still can’t decipher what that means. Maybe its just me.

        • TWC

          Nah, me neither. But at least it’s punctuated.

          • Cubbie Blues

            How about this way:
            “Wrigley renovation may not happen.: stop
            Todays Sun Times.: The big T at it again: stop
            Maybe they should move this FO.: stop
            Is ok Ricketts is ok?: stop
            People should LOOK at old.: stop
            FO one year 2003.: stop”

            • gutshot5820

              That was a beautiful interpretation. Thank you! Still confused though. LMAO

    • Coldneck

      Do they speak English is what?

  • RIck

    you know if the cubs are hurting with there attendance numbers. I wonder how the roof top owners are doing?

  • Frank

    I read the article and I sure got a lot of confidence that Ricketts was satisfied with 2.7 mil in attendance. I wonder if he’ll be satisfied with 2.5, 2.0,1.5,1.0. He can make it up by charging $20 for a hot dog, $75 for a beer and $500 for a ticket in the bleachers.

    • gutshot5820

      When attendance gets low like the last few games it means season ticket owners cannot even give them away.

      • Northside Neuman

        It means school has started.. That’s what it means.

      • Aisle 19

        No it doesn’t. Attendance counts tickets sold, not how many show up.

  • Northside Neuman

    Their was an article earlier this year with a estimated revenue breakout of how much the current WGN TV contract generates per game. I seem to recall $400k tp $500K per game which would put it roughly around $30 to $35 million for the 70 games they broadcast.

    The number i was thinking they could get of around $10 million seems low, could be upwards of $30 milion in additional revenues. Meaning with the new national MLB TV rights deal the Cubs could increase television revenues $56 million in the next 18 months.

    Not to shabby…

  • PKJ

    Brett– You don’t consider Edwin Jackson to be a “miss?” Still too early to tell, but dang, I’m starting to believe that his FIP will never catch up to his real performance.

    • http://www.bleachernation.com Brett

      I definitely do not, for two reasons: (1) his performance in 2013 was never going to be the difference between a good or bad team this year (and the front office knew it); and (2) his peripherals suggest he’s more likely to be a 3.50 ERA pitcher in 2014/15 (when it matters) than a 5.00 pitcher.

      That all said, that’s kind of beside the point of that statement in this post: that was about misses where the front office *didn’t* spend money because they didn’t have it.

      • PKJ

        Yes, he’s achieved 2 WAR, which is passable… He’s likely closer to his xFIP of 3.85. That LOB% is low and the BABIP is a tad higher than his career norms.

    • CubFan Paul

      Ignore the stats. Just watch/pay attention to EJax’s command/location and the spots he hits/misses (according to the catchers glove).

      He’s a competitor. Whatever Bosio had/has EJax working on (pitching aggressively low in the zone), it takes time. We’ll have a better EJax in year 2, I bet.

  • Stu

    Not to be dismissed as a troll by the usual “Cubs Way” politically correct crowd, but why are people surprised that the Ricketts family is interested in maximizing return on investment?

    The only way to have them produce a better product, RIGHT NOW, is to stop spending money on things associated with the Cubs. PERIOD. We can hope, plead, cry, groan or whatever. It doesn’t matter.

    It is all completely understandable that this site is about finding all of the silver linings because there is a desire within us to have some innocent child-like game which isn’t ruled by the cold, hard business of everything else in our daily life. I’m sorry if that just isn’t the case.

    The good news is that many fans are starting to get it. An empty Wrigley Field is the precursor for finally winning.

    • TWC

      “Not to be dismissed as a troll by the usual “Cubs Way” politically correct crowd…”

      Yeah. Not to start your complaint by preemptively insulting those who are predisposed to disagree with you…

      “The good news is that many fans are starting to get it.”

      Ooh! Start out with an insult and end with an insult! Well done, Stuart!

    • Cubbie Blues

      I think you have the “Cubs Way” crowd totally misconstrued.

    • http://www.bleachernation.com Brett

      As soon as you explain to me the big money moves that would have been good, long-term moves, and would have kept the payroll in the $140M range over the last two years, I’ll jump right on board with you that this is all about being cheap, and not about the rebuild and the unique environment (crappy TV contract, ballpark reno, unsupportive city/community).

      Darvish is the only one I can come up with. We always come back to this point, and folks always disappoint me in their efforts, even with the benefit of EXTREME hindsight.

      This team wasn’t going to be a 90-win team in 2012 and 2013 (almost) no matter what (just look at the Angels, for crying out loud). Why shoot for 85 wins when it gets you nowhere AND it makes acquiring minor league talent all the more difficult (those 85-win teams don’t trade Garza or Feldman or Dempster or Maholm … )?

      • Stu

        As much joking about how crazy the Dodgers took on payroll, look at the standings.

        The Cubs could have put a more credible team out their for current PAYING customers and still built a strong farm system. They are not mutually exclusive.

        The argument for currently paying for the product on the field has not been made. NOBODY should care how much debt the Ricketts took on to by the Cubs.

        On another note, I believe that the word troll is now used to suppress free speech in many cases. It is like other words to label people and thus dismiss them.

        • http://www.bleachernation.com Brett

          Having not addressed the substance, I’ll assume that you cannot.

          Also, I don’t think you’re a troll. I think you’ve got some weird victim complex going on when it comes to the Cubs, but you’re not a classic troll.

          Although your bizarre constitutional defense of trolls is borderline troll-y …

          • jon

            See, I thought Stu made a pretty valid point, that no, he doesn’t want a Angels situation, but the Dodgers might be a better comp, and that makes him a “border line” troll…mmmkaaay.

            • http://www.bleachernation.com Brett

              Yes, because that’s what I said …

              You want to be labeled a troll? One quick route is to misrepresent what others have said in service of your own point.

              • jon

                When Stu made a valid argument you said

                ” I think you’ve got some weird victim complex going on when it comes to the Cubs,”

                Then added

                “Although your bizarre constitutional defense of trolls is borderline troll-y ”

                Projecting a psychological disorder on someone when they make a valid point? Is that really necessary?

                • http://www.bleachernation.com Brett

                  Stu made no argument at all. That was the entire problem in the first place. He made assertions backed up by nothing. When I asked for specifics – as these conversations ALWAYS come to – he fell back on generalities and victimhood.

                  This ain’t my first rodeo. I have danced this dance many, many (many) times before. Hell, I’ve danced this same dance with Stu many times before.

      • baseballet

        Theo himself just said, “But in an ideal world we would be doing both. We would be infusing a lot more, sort of ready talent in this situation, to speed up the clock a little bit with Major League players. We don’t have that luxury right now.”
        So if Theo had the resources he would have spent money on major league players. The austerity measures result from necessity not strategy.

        • jon

          Exactly, from Theo’s direct mouth he says they essentially can’t operate fully on “dual fronts”. Why is that everyone that tries to point this out on this site labeled a “Troll”.

          There is a difference between typing out rants like “ZOMG SIGN EVERYONE” and pointing out, with valid sources, why you are unhappy with certain aspects of ownership and/or management.

          • Gutshot5820

            Well, I tried to make a similar “dual fronts” statement and Brett, the owner of the site started asking me for “proof” which is so lawyerly-like. But, oh well, I better shut my mouth now or I will probably get censored on this site.

            • http://www.bleachernation.com Brett

              Imagining that you’ve been aggrieved? Claiming to be censored when that’s never happened? Misrepresenting what others have said?

              I know certain among you hate to be called “trolls,” but these are *classic* internet behaviors associated with “trolling.” You are the master of your own behavior. Make better choices, get better results.

              • Gutshot5820

                Umm, uh oh ok Brett. Masta anything else?

                • willis

                  This is deteriorating quickly…kinda could have predicted that on a Ricketts piece though. He’s a lightening rod for sure.

                  • http://deepcenterfield.blogspot.com Jason Powers

                    The Billionaire and the Losing Ball Team – two items not to serve together in the blog cafeteria…(But the stuff is relevant.)

                • http://www.bleachernation.com Brett

                  You could not have formulated a more perfect response to sum all of this up.

                • MichiganGoat

                  And now we see the real gunshot… a sad poster that gets mad when anyone disagrees with him or asks for silly things like facts and proof.

                  • Gutshot5820

                    Good grief Goat… you would burn me to stake if you could to appease the Cubs. That’s how creepy and overboard you are. For your information, I don’t spend all of my day during work and evenings on this site like you. I like to drink and and do normal things that don’t involve baseball and condemning everyone that has anything negative to say about the Cubs. Get a life!

                    • MichiganGoat

                      And here is more proof to my above statement.

                    • jh03

                      Just stop. Please stop. It’s so freaking annoying. Your whole tirade is just annoying and immature. And that’s coming from a 20 year old.

                • http://deepcenterfield.blogspot.com Jason Powers

                  Gutshot: I think the Masta crap is a bit over the top.

                  But that’s the point, ain’t it?

              • Brains

                So there’s a difference in argumentative style here – one that begins with principles and one that looks at capacities available for decision making.

                This disagreement seems to come over the notion that the Cubs have a civic responsibility to serve their designated purpose – trying to win – if they have the means. Most responses to that look at logistical responsibilities, which resemble ownership logic or fantasy baseball.

                It’s pretty clear that the “Plan” is unravelling in a dramatic way in front of our eyes, and that the owners haven’t been completely on the level about what they’re going to do with our ticket money. Not that I could run a billion dollar organization myself, I couldn’t, but clearly they’re not very good at it either, at least when it comes down to reinforcing the _principle_ of competitive sports.

                Without Brett’s analysis I’d simply be confused – he’s the best on the web, but at some point the illusion of progress needs to be burst, and there are obvious reasons why progress isn’t happening. A difference in principle about the priorities of running a team – sportsmanship or business logic.

                • http://www.bleachernation.com Brett

                  I have trouble looking at the Cubs’ ridiculously stacked farm system and saying there hasn’t been progress or that The Plan is “clearly” unravelling.

                  To me, it looks pretty clear that – on the baseball side – The Plan is proceeding according to, well, The Plan.

                  • jh03

                    I’m not trying to be one of those people who just blindly agree with Brett, but yeah, he’s right. There has been a massive improvement in the farm, with significant money spent to improve it, since the time Ricketts bought the Cubs. And that includes bringing in Theo, to start. On the baseball side of things, The Plan is looking pretty freaking good.

                  • Gutshot5820

                    The farm is ridiculous, not because of anything the current ownership or Theo has done. It’s because we sucked balls and got the top picks in the past three drafts.

                    Big Four
                    1/ Baez -drafted pre-Theo
                    2/ Almora – Drafted with 6th pick – A no doubt Duh pick
                    3/ Bryant – Drafted with the number 2 pick – A no doubt Duh pick
                    4/ Solar – Ok I’ll give them this one

                    A large portion of the rest of the players were stocked because we turned and burned all our viable major league roster.

                    This is not ingenious and definitely not a new tactic. Any major league ball club that tanks four years in a row and turns and burns their entire major league roster twice will have a top farm. This would be partially acceptable on a small or mid-market team, but for a team in the third largest market charging the third highest ticket prices in the league? To me that’s just cheap tactics.

                    • jh03

                      There are so many different things one could say to counter your argument… But I’ll just keep it simple for you. You spelled “Solar” wrong.

                  • http://deepcenterfield.blogspot.com Jason Powers

                    We have McDonald’s Cubs Fans: Always wanting a quick-made-to-order champion within 5 minutes, even though none of us has even experienced a championship. Theo has…best give him more than 22 months to turn around the Titanic of franchises.

                    Cubs fans let the past (sunk seasons) color the future.

                    We need James Cameron to do a Cubs flick….

                  • Brains

                    I’ll cede this point. The “plan” doesn’t (currently) include the MLB club.

            • On The Farm

              So wait, you made a statement about something and then someone (doesn’t even have to be the site owner) asked you for proof and he is automatically being lawyerly-like and you are complaining about being censored?

              • Gutshot5820

                The actual request for “proof” in of itself is so ridiculous. Does Brett have any proof at all with any of his assumptions? Where is his “proof?” Does anyone really know what the heck is going on, except for a few snippets of what they read? I mean writers are just writing their own opinions themselves, they have no actual “proof” of anything and cannot provide hard evidence to back up what they are writing. Their opinion is as worthless as mine.

                I was making an assumption based on what I read and all of the sudden he;s asking for “proof” and to substantiate my assumptions as if anything he writes has a direct line to Ricketts financials. I will admit he a tons more baseball knowledge than I, but it doesn’t take a rocket scientist to understand that Ricketts is frugal and not the the big deep-pocketed sports fan we thought he would be,. Not to be misconstrued as cheap.

                • Cubbie Blues

                  Being in the finance realm, I always thought he would be frugal. That is a good thing (no more Milton Bradly’s (even though he was good while he was here)). We realize that you can’t show 100% accuracy, but what you can show (if it even exists) is what you saw that made you think the way you do. Those are the proofs, facts and reasons that are being asked for. Nobody is asking you anything that we don’t ask others and we also provide them when asked or presenting a new argument.

                  • Gutshot5820

                    I made a blanket statement that we unfortunately got Ricketts as our owner as a frugal Financial bean counter.and that he was not willing to spend to compete on dual fronts because he was not willing to spend until he was profitable.

                    I thought that was a no brainer after the past interviews and past season. Apparently,Brett disagrees and wants verification….? Laughable!!! on the Cubs willingness to spend to compete on “Dual fronts” the past few years. I think there is sufficient reason to make my assumption that without providing any substantive proof and disregard his pettiness. But whatever, if he wants to play GOD about it, that’s his prerogative..

                    • Cubbie Blues

                      I don’t know anything about that discussion, so I cannot comment on that. I am talking about this instance and the generalities of showing evidence of your claims. Also, if it was so evident, it shouldn’t have been difficult to show proof.

                • Northside Neuman

                  I find it ridiculous when someone make a statement about someone or some group being cheap after they paid $850 million dollars to buy something. Especially after they propose spending $500 million more to make the $850 million dollar object better.

                  You want ot call someone out for being cheap? Direct your eye’s on the Houston Astros owner whose payroll is $70 million less than the Cubs, they are doing the exact same rebuild and they don’t have a pending half billion dollar stadium project to fund.

            • hansman1982

              “…started asking me for “proof” which is so lawyerly-like.”

              Damn that Brett, damn him all to hell. We should get pitchforks and torches and tar and feathers and do stuff.

              In other news, I got new blinds for my living room and working on installing them. Blinds.com is a great place if you need window treatments.

              • Cubbie Blues

                We frown upon spam around here too. I call for that statement to be redacted. :lol:

                • hansman1982

                  STOP STIFILING MY CONSTITUIONAL RIGHT TO FREE SPEECH!!!!!!!!!!

            • Cubbie Blues

              Yes, this site is known for asking for facts and evidence to backup your claim. That is one of the best parts of this site, logical discussions. I ask for proof of claims all the time and I am definitely not a lawyer, I am a Design Engineer. Does that mean I look at things in an analytical way? Yes, it does.

              • On The Farm

                You can be a janitor, or doing a meaningless task on an assembly line for all I care, most people want to see some sort of proof/facts/reasoning behind something before blindly accepting things.

        • cubfanincardinalland

          You beat me to it. Most of you guys need to reread the interview with Epstein. Quite a stunning statement actually.
          I have come to the conclusion there are 2 possibilities. One, Epstein has realized the cubs are basically under a self produced salary cap, with little chance of much change with the sea of dysfunction that they are in revenue wise. And he had started the exit strategy.
          Two hopefully, the cubs are about to embrace the proper course, which is to find s home where they can run their business model correctly, and truly explode the revenues like the big market they are in should. Call me crazy, but there is something odd going on right now with the whole thing.

          • Scotti

            Not odd at all. Theo knew what the score was when he joined up. Ricketts wanted more revenue sources and was actively getting them (Mesa took very little time despite Mesa, a MUCH smaller city, bringing about $100 million to the party). Then the wheels fell off the Wrigley renovation and that costs BIG money every year it it’s delayed. There’s no magic behind this. It’s just shitty Chicago politics.

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